The UK has announced plans to overhaul its electricity market as the government seeks to prevent spikes in natural-gas prices and spur investment in lower-emitting technologies. BusinessGreen reports that the government’s Energy Bill and its promised electricity market reforms made it into the Queen’s Speech on Wednesday – that which sets out the government’s legislative agenda for the year and marks the start of the next session of Parliament – “and right near the top, alongside the commitment to introduce a Green Investment Bank, to boot.” In her speech, Queen Elizabeth II promised that the UK government would “propose reform of the electricity market to deliver clean and affordable energy.” And that one line, says BusinessGreen, “represents a major victory for the green wing of the coalition, a huge boost to the burgeoning low-carbon economy, and the long-awaited answer to the UK’s looming energy crisis. Make no mistake, this is a hugely significant piece of legislation.”
Bloomberg reports that the Electricity Market Reform bill will include long-term contracts that give power producers guarantees to help them attract finance for offshore wind turbines, nuclear reactors and carbon-capture and storage projects. The government has also decreed that British utilities will need to spend as much as £110 billion ($US177 billion) to replace ageing power plants and upgrade transmission networks by 2020. The UK has plans to add 18,000MW of offshore wind power to its power mix, and two new reactors by the end of the decade, replacing current generation, while also upgrading the grid. About half its coal-fired plants are due to close by 2016 and all its nuclear stations are scheduled to shut by 2035. The bill will also propose the creation of a capacity market, says Bloomberg, which would reward companies for running plants to back up intermittent wind generation. Other measures include adopting a nationwide emissions-performance standard and setting out strategic priorities for the energy industry.
Shares in New Zealand company TrustPower have surged after the announcement of the power purchase agreement for its $600 million, 270MW Snowtown wind farm in South Australia. The company’s shares have jumped more than 5 per cent in the past three trading days, taking gains over the last month when a deal was first speculated to around 10 per cent. They last traded at $NZ7.70, after hitting a three-year peak of $NZ7.95 on Tuesday.
New Zealand analysts say that the terms of the deal are compelling, and believe that TrustPower will have little problem attracting an institutional investor to take up near half share in the proposed development, which will sell its energy output to Origin Energy. TrustPower is majority owned by Infratil.
Origin cools on Geodynamics
Origin Energy, meanwhile, is no longer a major shareholder in geothermal aspirant Geodynamics after declining to take part in the Brisbane-based company’s recent fund raising. Origin announced on Tuesday that its stake had fallen below the 5 per cent level and has been diluted to 4.85% of Geodynamics’ issued capital.
Origin once held a 20 per cent stake in Geodynamics, as far back as 2003, and became a partner in its Cooper Basin geothermal project. Despite securing funding of $90 million for a demonstration plant, delays caused by technical and other issues caused Origin to write down more than $200 million from its investment last year. It also wrote down the value of its equity in investment in Geodynamics, whose shares have fallen from a peak of more than $2 to just 14c recently.
Drilling, meanwhile, has resumed at the Habanero wells, key to the creation of a pilot plant next year. The drill is current at 2,919m, the company said on Thursday. The company is targeting a depth of more than 4,100m for its Habanero 4 well as part of a $70 million drilling campaign.
Algae is go in Australia
ASX-listed biofuels company Algae.Tec has announced the commencement, this week, of commissioning for its showcase biofuels facility, Shoalhaven One, in Nowra. Algae.Tec executive chairman Roger Stroud said the process was on track for production of algae biomass in early June, ramping up to capacity by the end of June. “The Algae.Tec facility is positioned to take a carbon dioxide feed from the Manildra Groups manufacturing facility,” Stroud said, with bioreactor technology and associated racks, piping, and separation tanks in place, allowing full testing and final validation to commence. The Shoalhaven One initial bioreactors were assembled and shipped from The Algae Manufacturing and Development Centre in Atlanta, and Algae.Tec’s US-based technical director, Earl McConchie, is in Nowra overseeing the commissioning team. Algae.Tec also has carbon capture biofuels projects underway in Sri Lanka with cement giant Holcim, and in China. An arrangement is in place with Lufthansa for aviation fuel studies.
Infigen Energy says a survey had found that the majority of residents near its Capital Wind Farm near Bungendore are positive about the development, with only 1 per cent indicating they thought it had a negative effect on business. Infigen said the survey found that 68 per cent would support future wind farm developments in the area, and 15 per cent would not. Around 46 per cent said they knew a person or a business that had directly benefitted from the wind farm. And, it said, local real estate agents had suggested the wind farm had not damaged property values.